W. P. Carey research: $313 billion in company revenue at risk due to poor products and services

Consumer problems are up, but corporate complaint-handling improves in 2017

TEMPE, Ariz., (Nov. 15, 2017) — As the holiday shopping season begins a new survey shows just how unsatisfied Americans are with the products and services we buy. The 2017 Customer Rage study shows more than 62 million families experienced at least one problem during the past 12 months, making people frustrated and angry.

Despite big money spent on customer-service programs, 79 percent of consumers who complained are still not happy with the way their complaints are handled, jeopardizing repeat business. In 2017 customers reported slight improvements in complaint-handling satisfaction, but it’s still a failing grade — putting more than $300 billion dollars of future sales at risk. The study was released by the W. P. Carey School of Business at Arizona State University.

Top 10 highlights of the 2017 study include:

• Fifty-six percent of people reported customer problems in 2017, a steady increase over past years. In comparison, that number was just 32 percent forty years ago.
• The number of households experiencing “customer rage” dropped slightly in 2017, from 66 percent in 2015 to 56 percent this year.
• The bad news? Negative emotions are still unacceptably high in 2017, with 91 percent of people experiencing frustration, 84 percent reported feeling disappointment, and 62 percent reporting anger.
• Which products enrage customers the most? Cable/satellite TV, followed by computer (e.g., internet) services, and telephone.
• Among the 76 percent who complained about their most serious problem, corporate complaint-handing improved by a small margin in the eyes of consumers. Twenty-five percent say their issue was resolved upon initial contact, compared to 14 percent in 2015. Satisfaction by customers who reported they “got something” as a result of complaining also improved.
• When companies offered a free remedy, such as an apology, only 23 percent of people were happy. Satisfaction jumped to 73 percent when they received monetary relief and free remedies such as an apology.
• Forty percent of people reported feeling dissatisfied with the way their complaint was handled, as a result only three percent said they intend to buy again. On the flip side, if complainants were satisfied, 68 percent of them would re-purchase.
• In 2017, the telephone is still the primary way to complain, by a nearly six to one margin over the internet (70 to 12 percent).
• However, social networking websites can spread a massive amount of negative word-of-mouth (WOM), reaching 825 people on average, compared to 12 people under traditional WOM.
• Which corporate telephone customer-service practices do consumers hate most? Automated phone technology without the option to talk with a live person, followed by “try to sell you something,” customer service agents with accents, and outsourcing.

This is the eighth Customer Rage Survey since the original was conducted by the White House in 1976. The independent study is conducted by Customer Care Measurement & Consulting (CCMC) in collaboration with the Center for Services Leadership, a research center within the W. P. Carey School of Business at Arizona State University, Confirmit, and Bernett, which interviewed 1,000 respondents by phone.

The bottom line: Bad customer service is worse than no customer service.

“Nearly 80 percent of complaining customers were not satisfied with how business responded to their problems. These dissatisfied complainants were more than 60 percent less brand loyal than satisfied complainants. Most businesses, therefore, earn a negative return on investment,” said Scott Broetzmann, president and CEO of Customer Care Measurement & Consulting. “The lesson to be learned, then, is do it right, or don’t do it.”

What can businesses do?

“When customers complain, they don’t want to waste their time repeating their problems to multiple people,” said Mary Jo Bitner, co-executive director of the Center for Services Leadership at ASU’s W. P. Carey School of Business. “First contact resolution saves customers precious time and eliminates the frustration of having to repeat themselves. Businesses need to understand what their customers expect when there is a failure, which requires knowledge, research, and communication with customers. Then they need to efficiently, politely, and positively respond to their complaints in a manner consistent with what they expect.”

Customer Care Measurement & Consulting

CCMC’s customer satisfaction and loyalty surveys and analytics are used by leading Fortune 500 companies from every industry to get a better ROI for their investments in the customer experience.

Confirmit

Confirmit is the world’s leading SaaS vendor for multi-channel Customer Experience, Employee Engagement, and Market Research solutions. Confirmit powers Global 5000 companies and Market Research agencies worldwide with a wide range of software products for feedback / data collection, panel management, data processing, analysis, and reporting. Customers include Aurora, British Airways, British Standards Institution, Cross-Tab, Dow Chemical, GfK, GlaxoSmithKline, GMO Research, KeepFactor, Morehead Associates, Nielsen, Research Now, RS Components, QRS, SSI, Sony Mobile Communications, and Swisscom.

Bernett Group

The Bernett Group is a marketing research agency headquartered in Boston’s Fort Point neighborhood. With national call-center capabilities and in-house technology specialists to collect and analyze data, Bernett is a one-stop shop for researchers that require accurate, high-quality market intelligence. Family owned and operated, Bernett has been a trusted partner for political consultants, national media companies and global market researchers since 1972.

About the W. P. Carey School of Business

The W. P. Carey School of Business at Arizona State University is one of the top- ranked and largest business schools in the United States. The school is internationally regarded for its research productivity and its distinguished faculty members, including a Nobel Prize winner. Students come from more than 100 countries and include over 50 National Merit Scholars. For more information, please visit wpcarey.asu.edu.

For more information / Media contact:
Rebecca Ferriter, W. P. Carey School of Business
Rebecca.Ferriter@asu.edu
310-871-9041